Q1. Calculate Going-in Cap Rate (Ro): Q2. Calculate the Equity Dividend Ratio (EDR): Q3. Calculate the Effective Gross Income Multiplier (EGIM): Q4. Calculate the Operating Expense Ratio (OER): Q5. Calculate the Debt Coverage Ratio (DCR):

REAL ESTATE HW #3 . You are considering purchasing a small office building for .Your expectations include: $1,975,000 - First-year gross potential income of $340,000; -Vacancy & collection losses equal to 15% of PGI; Operating expenses = 40% of EGI; -Capital expenditures = 5% of EGI $1,481,250 mortgage (75% LTV) @ 7% Mortgage will be amortized over 25 years with a monthly payment of $10,469.17 -Total up-front financing costs-2% of the loan amount - Required equity investment is $523,375 [$1,975,000 ($1,481,250 $29,625)] REAL ESTATE HW #3 . You are considering purchasing a small office building for .Your expectations include: $1,975,000 - First-year gross potential income of $340,000; -Vacancy & collection losses equal to 15% of PGI; Operating expenses = 40% of EGI; -Capital expenditures = 5% of EGI $1,481,250 mortgage (75% LTV) @ 7% Mortgage will be amortized over 25 years with a monthly payment of $10,469.17 -Total up-front financing costs-2% of the loan amount - Required equity investment is $523,375 [$1,975,000 ($1,481,250 $29,625)]